Pay rises at slowest rate for two years and job vacancies fall, in sign Bank of England will keep interest rates steady
12 December 2023, 08:31
Salaries have risen at the slowest quarterly rate for two years and the number of job vacancies has fallen, suggesting the Bank of England could choose to hold interest rates steady on Thursday.
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Average private sector pay, excluding bonuses, rose by 7.1% in the three months to October 2023, down from a 7.8% increase in the previous quarter.
It marks the smallest jump in average pay since the three months to November 2021, according to the Office for National Statistics (ONS).
But salaries still increased by 1.2% above inflation, which Chancellor Jeremy Hunt welcomed as a "positive" sign.
The number of job vacancies fell for the 17th month in a row - the longest period of decline on record. Vacancies were down by 45,000 in the three months to November to 949,000, according to the ONS.
The unemployment rate was flat at 4.2% in the three months to October. But more real-time figures suggested the number of people in jobs fell by 13,000 in November to 30.2 million.
The Bank of England's monetary policy committee is expected to leave the base rate unchanged at 5.25% at its final 2023 meeting on Thursday, with previous successive hikes having helped curb inflation.
ONS director of economic statistics Darren Morgan said: "Job vacancies fell again. This is now the longest period of decline on record, longer than in the immediate aftermath of the 2008 downturn.
"Nevertheless, the number of vacancies still remains well above its pre-pandemic level.
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"While annual growth in earnings remains high in cash terms, there are some signs that wage pressure might be easing overall.
"However, as inflation has been falling more quickly, pay continues to grow in real terms."
Mr Hunt said: "It's positive to see inflation continue to fall and real wages growing.
"At the autumn statement, I announced an ambitious set of measures to get more people into work and boost economic growth.
"This includes a significant expansion of health support and an over £9 billion per year tax cut for employees and the self-employed, worth over £450 for the average worker."
